|Wednesday, February 16, 2000,
Rs 8,454 cr package for
More scrips for NSE trading
Rs 8,454 crore package for SAIL
NEW DELHI, Feb 15 The government today approved a Rs 8454 crore financial package for the revival and restructuring of the loss-making Steel Authority of India Ltd. (SAIL).
The decision on the long-awaited package, including waiver of Rs 5450 crore loan from the Steel Development Fund (SDF) and the Government, was taken by the Union Cabinet, Pramod Mahajan, Parliamentary Affairs Minister told reporters.This is being done taking into consideration the IDBI and McKenzies report on SAIL restructuring.
The restructuring will start with the power plants of Bokaro, Durgapur and Rourkela steel plants, oxygen plant at Bhilai, fertiliser plant at Rourkela, alloy steel plant at Durgapur and Vishwyera iron and steel company at Vadrabati and Salem steel plant in Tamil Nadu. SAIL was also allowed to go in for a joint venture partner for the revival of the Indian Iron and Steel Company Limited (IISCO) with minority holding.The Government has waived the Rs 5073 crore loan from the Steel Development Fund (SDF) and another amount of Rs 381 crore from the Government. This waiver would enable SAIL to reduce its asset value by Rs 3001 crore, offset the Rs 1947 crore advanced by SAIL to its subsidiary IISCO for its operations and compensate SAIL for the Rs 506 crore of interest on loans to IISCO written off by it earlier.
This would also set the tone for the revival of IISCO.The Government has sanctioned a guarantee for loan and interest on Rs 1500 crore which SAIL can also raise from the market for meeting repayment obligations on past loans. The Government has already provided a guarantee for one-third of this amount which SAIL had raised from the market in January 2000. SAILs manpower was about 1.80 lakh about two years back.
The company on its own took up the VR scheme. As a result the workforce strength has come down to 1.60 lakh and this is expected to further come down to just one lakh in another two to three years.Cellular scheme. The Cabinet today approved the proposal to extend till March 15 the time for the basic and cellular service operators to pay the balance amount of licence fee dues resulting from the telecom migration package, along with additional penalty, subject to fulfilment of certain conditions.
As per the licence agreement the payment of entire dues will have to be made by March 15 along with simple interest of 3 per cent per month for the period February 1, 2000 to March 15, 2000 on a proportionate basis.The licencee will be required to furnish at the earliest or in any case on or before February 29 bank guarantees securing the full amount of outstanding dues and interest thereon calculated up to March 31, 2000.
age: The Cabinet approved a proposal of Indian
Airlines to reduce the retirement age from 60 to 58 years
in order to reduce its losses.The reduction in the
retirement age will save around Rs 193.38 crore to the
loss making aviation in the next five years.The Vajpayee
Government in May 1998 had taken a decision to increase
the retirement age of Indian Airlines employees but now
reduced it to minimise the losses.
disinvest 51 pc equity in NFL
NEW DELHI, Feb 15 The Cabinet Committee on Disinvestment (CCD) today approved disinvestment of 51 per cent equity of the Government in National Fertiliser Limited, a profit-making public sector unit, to a strategic buyer along with the transfer of management control. The Government, at present, has a share holding of 97.6 per cent, financial institutions have 2.3 per cent and employees have 0.1 per cent.
The Disinvestment Commission had classified NFL, the countrys second largest producer of urea, as non-core and recommended that the Government should sell a minimum of 51 per cent equity to a strategic buyer with transfer of management.The CCD also gave approval for appointment through a global process of competitive selection of merchant banker/global adviser to work out details and modalities of disinvestment of government equity in NFL.
The selection of global adviser/merchant banker would be done by an inter-ministerial group to be constituted by the Department of Disinvestment with representatives from the Administrative Ministry, the Department of Public Enterprises and the Department of Economic Affairs and the Chief Executive and Director (Finance) of the company.
The decision will lead to better utilisation of capitalised value of disinvested shares, supplementing the fund requirement for fresh investment in the revival of fertiliser public sector units as approved by the Government subject to normal rules for budgetary support.The task will be completed by December 31, 2000.
The authorised share capital of the company is Rs 500 crore with a paid-up capital of Rs 490.58 core. The share holding of the government has reduced to 97.6 per cent by disinvesting the paid-up capital in favour of financial institutions and others.The company posted a profit of Rs 41.15 crore in 1998-99 compared to Rs 189.01 crore in 1997-98.
NFL posted profit of Rs
11.20 crore in 1996-97, Rs 54.06 crore in 1995-96 and Rs
121.93 crore in 1994-95.With an installed capacity in the
region of 1400 million tonnes, NFL reported capacity
utilisation of 110.5 per cent in 1997-98 and 107.8 per
cent in the next fiscal. The company has about 6700
SHCIL ties up with Bank of Punjab
CALCUTTA, Feb 15 (PTI) Stock Holding Corporation of India Ltd (SHCIL), the countrys largest custodian for securities, has tied up with two commercial banks for IPO financing and to provide loans against shares.The Managing Director of SHCIL, Mr B.V. Goud, told reporters here today that an arrangement has been made with Bank of Madura and Bank of Punjab for providing financial assistance in this regard.However, this facility will be made available to the existing demat account holders of SHCIL.
Stating that SHCIL was aiming to become a financial supermarket to boost its income, Goud said the corporation was intending to distribute government securities. RBI had given in-principle approval to SHCIL to deal in the securities. Besides, SHCIL was also planning to market mutual funds, PSU bonds, AAA-rated deposits and consumer loans.
diversifications will enable SHCIL to augment revenue and
to offset the falling income from custodian
operations.According to him, due to the shift from
physical to electronic transactions in share trading,
there had been a significant fall in income from
custodian operations.SHCIL has projected an income of Rs
100 crore for the financial year 1999-2000 and a
corresponding profit of Rs 22 crore.
WASHINGTON, Feb 15 (PTI) In a shocking revelation, the USA has said that tens of billions of dollars are involved in corruption in the export of goods and services to developing countries from industrialised nations.
Corruption in the export of goods and services from abroad to developing countries is in tens of billions of dollars, Under Secretary of State for Economic, Business and Agriculture Affairs Alan Larson said yesterday on the first anniversary of the coming into force of a convention signed by industrial countries to penalise corruption by their companies.He said there were still some countries which had not yet barred tax deduction for bribes paid.
Meanwhile, a review of
the convention released by Larsen cautioned that
effective supervision of subsidiaries with regard to
bribery in international business transactions is
an issue that merits continued attention.The report
said during the negotiations on the convention, the USA
sought to bar bribes by foreign corporations to political
party officials and candidates for political office in
developing countries as is being done in America.
Quality of govt expenditure poor
NEW DELHI, Feb 15 (PTI) Comptroller and Auditor General of India V.K. Shunglu today blamed poor tax compliance and dismal quality of government expenditure as prime reasons for fiscal deficit in the country and cautioned that mere expenditure control could not be a solution for curtailing it.
Inaugurating a workshop on Fiscal Responsibility of Government, organised by the National Institute of Financial Management, Shunglu said the deficit problem was further exacerbated by poor returns on high cost central borrowings.
The CAG said it was important for the Centre to enhance the tax compliance for plugging the deficit and using the same for developmental purpose.Quality of expenditure is as important as the quantity, he said adding the quality of expenditure has become extraordinarily poor.
Stating that fiscal
deficit is being identified too much
with the expenditure side of the Budget with a belief
that if only expenditure can be curtailed, the fiscal
deficit can be addressed, Shunglu said: I believe
this is not the only side and it is the wrong side of
looking at the system.
for Punjab units by March 31
LUDHIANA, Feb 15 The Punjab Government will disburse Rs 15 crore as subsidy to industrial units in the State by March 31.This was announced by the Principal Secretary, Industries, Mr Ramesh Inder Singh, at an industrial meeting held here yesterday under the auspices of the Chamber of Industrial and Commercial Undertakings (CICU).
Mr D S Guru, Director, Industries, and Mr Inderjit Singh Pardhan, President, CICU, and officers from the Punjab Pollution Control Board, the Punjab Financial Corporation and PSIEC, were present.Mr R. I. Singh said the Government had no plans to discontinue subsidy or other concessional incentives available to old or new units in the State.
He, however, said the Centre was not in favour of continuance of subsidies. The State Government had not taken any decision in this regard so far.The uniform sales tax proposed by the Centre was infact a minimum sales tax which had been agreed to by about 80 per cent of the States and UT of Chandigarh.
The Government would not
insist on resumption of industrial plots if the allottees
stopped misusing them for commercial purposes, he added.
MUMBAI, Feb 15 (PTI) More securities would be available for trading on the capital market segment of the NSE from tomorrow.
In the physical segment,
equity shares of Shri Shakti LPG Ltd, Morepen Hotels Ltd
and Television Eighteen India Ltd have been added, while,
in the depository segment, equity shares of Television
Eighteen India Ltd, Bharat Hotels Ltd, DLF Cement Ltd,
KSB Pumps Ltd, Lakanpal National Ltd, Sri Adhikari
Brothers Television Network Ltd, Transchem Ltd and Upper
Ganges Sugar would be available for trading, a NSE
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